Did you immigrate to Canada and become a resident of the country in 2018?

If you’re a newcomer to Canada, you become a resident for income tax purposes when you establish significant residential ties (such as a home or spouse or dependants living in Canada) in the country. Usually, these are established the day you arrive in Canada.

If you don’t have a home, a spouse or common-law partner, or dependants living with you in Canada, you’ll still be considered a resident if you’ve any of the following residential ties:

Personal property in Canada (car, furniture, etc.)

Social ties (memberships in recreational or religious organizations in Canada)

Bank accounts or credit cards issued in Canada

A Canadian driver’s licence

A Canadian passport

Health insurance with a Canadian province or territory

Did you know? If you were a resident of Canada in an earlier year and you moved away from Canada, you’ll be considered a Canadian resident for income tax purposes when you move back and re-establish your residential ties.

As a resident of Canada, you must file a tax return, for part or all of the year, if you:

Have to pay taxes or

Want to claim a refund

Even if you didn’t have any income for the year, you should still file a return as it lets the Canada Revenue Agency (CRA) determine your eligibility for certain benefits like the GST/HST credit, Canada child benefit, and other provincial/territory programs.

Why do I need to report the income I earned in 2018 before I became a Canadian resident?

Reporting the income that you earned before you became a Canadian resident helps the CRA determine the amount of non-refundable and refundable tax credits you’re entitled to. For example, in order to receive refundable credits in full, at least 90% of your income must come from Canadian sources.

Note: If your net income from foreign and Canadian sources for the year is zero, the 90% rule no longer applies, and you’ll receive the full refundable credits you’re entitled to.

Need more help? You can message your Tax Expert at any time from the Messages section of your dashboard.